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Govt to propose winding up IBRC

Wednesday, February 06 17:16:04

The Government plans to liquidate failed IBRC - formerly Anglo Irish Bank - as part of a deal it is seeking to strike with the European Central Bank (ECB) to ease its bank debt burden, a source familiar with the discussions said today.

The ECB rejected Ireland's preferred solution to reschedule part of its bank bailout bill when its board discussed the plan for the first time last month, EU sources familiar with the talks told Reuters.

Irish Central Bank governor Patrick Honohan, the country's representative on the ECB's Governing Council, will put a revised plan to his fellow central bank governors this evening in Frankfurt, a second source said.

Under the plan Honohan will present a plan in which Anglo Irish Bank now known as IBRC will be liquidated so that the government no longer has to make hefty annual payments on a 28 billion euro promissory note used to bail it out.

The Government is desperate to avoid having to pay a politically incendiary E3.1 billion a year until 2023 to service the notes issued to underwrite Anglo and has been in talks to do so for some 18 months.